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EXHIBIT 10.33
PURCHASE MONEY SECURED PROMISSORY NOTE
U.S. $3,000,000.00 Irvine, California
August 15, 1996
FOR VALUE RECEIVED, the undersigned, UROHEALTH SYSTEMS, INC., a
Delaware corporation ("Borrower") promises to pay to ▇▇▇▇▇▇▇▇▇ ASSOCIATES, a
Michigan partnership ("Lender"), or order, at the address set forth below, the
principal sum of Three Million and no/100 Dollars ($3,000,000.00), together with
interest on the unpaid principal amount hereof, calculated at the rate and
payable at the times set forth below.
1. Interest Rate. Except as provided in Section 4.3 below, the
outstanding principal balance hereof shall bear interest from the date hereof
until paid in full at the lessor of (i) the maximum interest rate permitted by
law or (ii) eight and one-quarter percent (8.25%) per annum (the "Interest
Rate").
2. Payments During Term. As used in this Note, (a) the term "Quarterly
Payment Date" shall mean the first day of each calendar quarter or portion
thereof during the term of this Note and (b) the term "Calendar Quarter" shall
mean the calendar quarter or portion thereof immediately preceding a Quarterly
Payment Date. Commencing on the first Quarterly Payment Date following the date
hereof and continuing on each successive Quarterly Payment Date thereafter,
Borrower shall make a payment (the "Quarterly Payment") equal to the amount
required to pay the amount of the accrued but unpaid interest on this note. The
entire unpaid principal balance of this Note, together with all accrued but
unpaid interest thereon, shall be due and payable in full on the tenth (10th)
anniversary of the date hereof (the "Maturity Date").
3. Prepayment. Borrower shall be permitted to prepay all or any part of
the outstanding principal balance of this Note without penalty or premium.
4. Default; Remedies.
4.1 Event of Default. An "Event of Default" shall occur hereunder
(a) upon the failure of Borrower to pay any installment of interest or any other
amount due hereunder within five (5) calendar days after ▇▇▇▇▇▇▇▇'s receipt of
written notice from Lender that such installment was not paid when due, (b) upon
the failure of Borrower to pay the outstanding principal balance of this Note,
together with all accrued interest thereon, on the Maturity Date, and (c) upon
the occurrence of an "Event of Default" as defined in that certain Mortgage,
Security Agreement, Assignment of Rents and Leases, and Fixture Filing (the
"Mortgage") of even date herewith, made by ▇▇▇▇▇▇▇▇, as mortgagor, in favor of
▇▇▇▇▇▇, as mortgagee, encumbering certain real property (the "Property")
described therein.
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4.2 Acceleration. Upon the occurrence of any Event of Default,
Lender may (a) declare the entire principal amount of this Note then outstanding
(if not then due and payable), together with all accrued interest thereon, and
all other sums or payments required hereunder, to be due and payable
immediately, and notwithstanding the Maturity Date, the principal amount of the
Note, together with all accrued interest thereon, and all other sums or payments
required hereunder shall thereupon become and be immediately due and payable,
and (b) exercise such other remedies as Lender may have under the Mortgage.
4.3 Late Charge: Default Interest Rate.
(a) ▇▇▇▇▇▇▇▇ agrees that if any payment due hereunder is not
received within five (5) calendar days after the date it becomes due and
payable, Borrower shall pay to Lender an amount (the "Late Charge") equal to
five percent (5%) of the amount of the delinquent payment; provided however,
such Late Charge shall not be applicable to the accelerated balance of the Note
upon the occurrence of an Event of Default. In addition, upon the occurrence and
during the continuance of an Event of Default hereunder, the outstanding
principal amount hereunder, together with all accrued interest thereon, shall
bear interest at a per annum rate (the "Default Rate") equal to two (2)
percentage points over the Interest Rate.
(b) ▇▇▇▇▇▇▇▇ acknowledges and agrees that (i) ▇▇▇▇▇▇'s actual
damages resulting from any default or delinquency of Borrower as set forth in
Section 4.3(a) above and that relate to lost use of funds or costs of internal
administration of delinquent payments hereunder or relating to such default
would be extremely difficult to ascertain, and (ii) under the circumstances in
existence as of the date hereof, the Late Charge and the accrual of interest
hereunder at the Default Rate constitute a reasonable liquidation of such
damages. The provisions of this Section 4.3 are in addition to the other rights
and remedies conferred upon ▇▇▇▇▇▇ under this Note and shall not limit ▇▇▇▇▇▇'s
right to compel prompt performance hereunder or be deemed to conflict with the
provisions of Section 5.12 of this Note.
5. Miscellaneous.
5.1 Payment in U.S. Currency. Principal and interest shall be
payable in lawful money of the United States of America.
5.2 Cost of Collection. Borrower promises to pay all costs and
expenses of collection, including without limitation (a) reasonable attorneys'
fees, in the event that collection of this Note or any portion of this Note is
effected without suit; (b) reasonable attorneys' fees, as determined by the
judge of the court, and all other costs, expenses and fees incurred by Lender in
the event suit is instituted to collect this Note or any portion of this Note;
and (c) reasonable attorneys' fees, incurred by Lender in connection with any
bankruptcy, insolvency or reorganization proceeding or receivership involving
Borrower or any affiliate of Borrower, including without limitation attorneys'
fees incurred in making any appearances in any such proceeding or in seeking
relief from any stay or injunction issued in or arising out of any such
proceeding.
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5.3 Crediting of Payments. All payments and prepayments
hereunder shall be credited first to unpaid interest, if any, which has accrued
hereunder and second to unpaid principal hereunder.
5.4 Waiver of Notice, Etc. Borrower waives diligence, grace,
demand, presentment for payment, exhibition of this Note, protest, notice of
protest, notice of dishonor, notice of demand, notice of nonpayment, and any and
all exemption rights against the indebtedness evidenced by this Note, to the
fullest extent permitted by applicable laws. Borrower consents to offsets of any
sums owed to it by ▇▇▇▇▇▇ at any time. No single or partial exercise of, or
forbearance from exercising, any power hereunder or under or under any guaranty,
or other agreement or instrument securing or pertaining to this Note shall
preclude other or further exercises thereof or the exercise of any other power.
Lender shall at all times have the right to proceed against any portion of the
security, if any, held herefor in such order and in such manner as Lender may
determine in its sole discretion, without waiving any rights with respect to any
other security.
5.5 No Waiver by ▇▇▇▇▇▇. Delay or failure by Lender to exercise
any option or election herein given to Lender shall not constitute a waiver of
the right to subsequently exercise such option or any other option or election
herein given to Lender.
5.6 Successors and Assigns; Number; Gender. The use of the term
"Borrower" shall be deemed to include the successors and assigns of the
undersigned. The use of terms in any gender or number shall include, in all
instances, the masculine, feminine, and neuter gender and the plural and single
number.
5.7 Notices. Except as otherwise provided herein, all notices or
communications required or permitted hereunder shall be in writing and
personally delivered or sent by express mail or certified mail, return receipt
requested, postage fully prepaid and addressed to the respective parties as
follows:
If the Lender:
▇▇▇▇▇▇▇▇▇ ASSOCIATES
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇ ATTORNEYS, P.C.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
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If to Borrower:
UROHEALTH SYSTEMS, INC.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇, Esq.
5.8 Governing Law. This Note shall be governed by and construed
under the laws of the State of Michigan and the laws of the United States of
America prevailing in Michigan.
5.9 Joint and Several Obligations. If Borrower consists of more
than one (1) person or entity, each shall be jointly and severally liable to
Lender hereunder.
5.10 Performance of Acts on Business Days. In the event that the
final date for payment of any amount hereunto falls on a Saturday, Sunday or
state or federal holiday, such payment may be made on the next succeeding
business day.
5.11 Computation of Interest. The computation of interest
hereunder shall be based on a year of three hundred sixty (360) days and a
thirty (30) day month.
5.12 Time of Essence. Time is of the essence of the performance
of each provision hereof.
5.13 Place for Payment. All payments due hereunder shall be sent
to Lender at ▇▇▇▇▇▇'s address set forth in Section 5.7 above or to such other
place as Lender or other legal holder of this Note may designate in writing from
time to time.
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IN WITNESS WHEREOF, ▇▇▇▇▇▇▇▇ has executed this Note on the year and
date first hereinabove set forth.
UROHEALTH SYSTEMS, INC.,
a Delaware corporation
Tax Identification No. ▇▇-▇▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Sr. Vice President
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